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Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:
Sales between 2nd and 29th June Rs.9,45,000
General administration cost Rs.25,000
Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000
Purchases (including freight inward):
June 1 2,00,000 litres @ Rs 2.85 per litre
June 30 1,00,000 litres @ 3.03 per litre
June 30 Closing stock 1,30,000 litres.
The profit or loss for June using LIFO method of inventory Method is
Sales between 2nd and 29th June Rs.9,45,000
General administration cost Rs.25,000
Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000
Purchases (including freight inward):
June 1 2,00,000 litres @ Rs 2.85 per litre
June 30 1,00,000 litres @ 3.03 per litre
June 30 Closing stock 1,30,000 litres.
The profit or loss for June using LIFO method of inventory Method is
- a)Rs 1,95,500
- b)Rs 165,000
- c)Rs 1,40,000
- d)Rs 1,95,000
Correct answer is option 'C'. Can you explain this answer?
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Verified Answer
Bharat Indian oil is a bulk distributor of petrol . A periodic invento...
Net Profit = Sales - Cost of goods sold - General admin cost
= 9,45,000 - 7,80,000(WN 1) - 25,000
= 1,40,000
Calculation of quantity of goods sold = Opening stock + purchases - Closing stock
= 1,00,000 + 3,00,000 - 1,30,000
= 2,70,000
Amount of goods sold (under FIFO) = 1,00,000 x 3 = 3,00,000
1,70,000 x 2.85 = 4,84,500
= 7,84,500
Most Upvoted Answer
Bharat Indian oil is a bulk distributor of petrol . A periodic invento...
Calculation of Cost of Goods Sold (COGS) using LIFO method:
LIFO (Last-In-First-Out) method assumes that the last inventory purchased is sold first. Therefore, the cost of goods sold will be calculated based on the cost of the last inventory purchased.
Step 1: Calculate the cost of goods available for sale
Opening stock (1,00,000 litres @ Rs.3 per litre) = Rs.3,00,000
Purchases:
- June 1 (2,00,000 litres @ Rs.2.85 per litre) = Rs.5,70,000
- June 30 (1,00,000 litres @ Rs.3.03 per litre) = Rs.3,03,000
Total purchases = Rs.8,73,000
Total cost of goods available for sale = Rs.11,73,000
Step 2: Calculate the cost of goods sold
Closing stock (1,30,000 litres @ Rs.3.03 per litre) = Rs.3,93,900
Cost of goods sold = Cost of goods available for sale - Closing stock
= Rs.11,73,000 - Rs.3,93,900
= Rs.7,79,100
Step 3: Calculate Gross Profit
Sales (between 2nd and 29th June) = Rs.9,45,000
Cost of goods sold = Rs.7,79,100
Gross Profit = Sales - Cost of goods sold
= Rs.1,65,900
Calculation of Net Profit using LIFO method:
Step 4: Deduct the General Administration Cost from Gross Profit
Gross Profit = Rs.1,65,900
General Administration Cost = Rs.25,000
Net Profit = Gross Profit - General Administration Cost
= Rs.1,65,900 - Rs.25,000
= Rs.1,40,900
Therefore, the profit or loss for June using LIFO method of inventory is Rs.1,40,900 (option C).
LIFO (Last-In-First-Out) method assumes that the last inventory purchased is sold first. Therefore, the cost of goods sold will be calculated based on the cost of the last inventory purchased.
Step 1: Calculate the cost of goods available for sale
Opening stock (1,00,000 litres @ Rs.3 per litre) = Rs.3,00,000
Purchases:
- June 1 (2,00,000 litres @ Rs.2.85 per litre) = Rs.5,70,000
- June 30 (1,00,000 litres @ Rs.3.03 per litre) = Rs.3,03,000
Total purchases = Rs.8,73,000
Total cost of goods available for sale = Rs.11,73,000
Step 2: Calculate the cost of goods sold
Closing stock (1,30,000 litres @ Rs.3.03 per litre) = Rs.3,93,900
Cost of goods sold = Cost of goods available for sale - Closing stock
= Rs.11,73,000 - Rs.3,93,900
= Rs.7,79,100
Step 3: Calculate Gross Profit
Sales (between 2nd and 29th June) = Rs.9,45,000
Cost of goods sold = Rs.7,79,100
Gross Profit = Sales - Cost of goods sold
= Rs.1,65,900
Calculation of Net Profit using LIFO method:
Step 4: Deduct the General Administration Cost from Gross Profit
Gross Profit = Rs.1,65,900
General Administration Cost = Rs.25,000
Net Profit = Gross Profit - General Administration Cost
= Rs.1,65,900 - Rs.25,000
= Rs.1,40,900
Therefore, the profit or loss for June using LIFO method of inventory is Rs.1,40,900 (option C).
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Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer?
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Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer?.
Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer?.
Solutions for Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
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Here you can find the meaning of Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer?, a detailed solution for Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Bharat Indian oil is a bulk distributor of petrol . A periodic inventory of petrol on hand is taken when the book are closed at the end of each month. The following summary of information is available for the month:Sales between 2nd and 29th June Rs.9,45,000General administration cost Rs.25,000Opening Stock :1,00,000 litres @ Rs.3 per litre Rs.3,00,000Purchases (including freight inward):June 1 2,00,000 litres @ Rs 2.85 per litreJune 30 1,00,000 litres @ 3.03 per litreJune 30 Closing stock 1,30,000 litres.The profit or loss for June using LIFO method of inventory Method isa)Rs 1,95,500b)Rs 165,000c)Rs 1,40,000d)Rs 1,95,000Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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